Shoppers Love Privacy Enough To Pay For It

by Ruud Hein August 17th, 2007 

The Carnegie Mellon University has published an interesting study which attempts to show that online shoppers are so concerned with their privacy that they are willing to pay for it.

Sounds catchy and I imagine some e-merchants running to their keyboard to hammer out a premium "upgrade privacy package" page but alas, it is a little bit different.

See, the 72 subjects were given money to make two online purchases (don't ask what…) and some were sent to Privacy Finder, a shopping search engine which takes privacy policies into account. This too is a project of the Carnegie Mellon University.

Now, the interesting part is that those who were able to find a shop with an online privacy policy of their liking were more likely to make an online purchase at that shop. Better yet, from the point of view of the merchant, they were willing to pay 60 cents more on a $15 purchase. The researchers say more and other research is needed to establish just how much shoppers are willing to pay more for their sense of security.

Of course we know that shoppers are actively looking to establish some sense of security. That is why security seals and their placement matter so much.

But in the end focusing on privacy and security fulfillment is missing the big picture. It's dealing with the symptoms. It doesn't ask who is concerned why.

See, failure to understand the real needs of the shopper will otherwise turn privacy policy pages into the same mess About Us, Contact Us and Site Map pages have become: you have to have it because you have to have it.

The real need of the shopper, as I see it, is transparency. It is the black box mystery, the media-fueled fear, the pure uncertainty of not only what is happening but what might happen.

Remember, even the young computer savvy person coming to your shopping site has mainly hear-say knowledge of online security. That hear-say knowledge includes the Russian mafia, trojans stealing his passwords, WiFi networks being ripped apart … and worse.

In other words, TAC (The Average Consumer) has a purely anecdotal knowledge of how bad things can be.

To counteract the know-it-all who blabs dark tales on a birthday party, you need transparency,  you need full disclosure. And you need it not in a document formulated and approved by the legal department; you need it in the form of an upfront talk between you and me.

You need to say, OK, yes, we are collected data about you and your purchases. Here is what we collect. Here is how we and where we store it. Here are the laws under which that information is protected. Here's what we're going to do with that information. And here is how all this relates to you.

Go a step further. Think! What do they worry about? Credit card details! OK, so, write something. Sit together with your customer, your friend, and say, look, I'm accepting this information over an encrypted line. Even if someone would eavesdrop, it is just garbage to them. And then even if I were to write your number of a piece of paper and distribute it, you're protected through your credit card company. And…. and…. etc.

Making a sale is a process of removing any obstruction and objection that stands between a shopper and his or her desired purchase. They're just looking for a little bit of help.

What are you going to do?

Ruud Hein

My paid passion at Search Engine People sees me applying my passions and knowledge to a wide array of problems, ones I usually experience as challenges. People who know me know I love coffee.

Ruud Hein

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